Tuesday, August 25, 2009

How To Lose Your Best Employees or High Producing Salespeople

Here are 7 ways to get rid of your best performers:

1. Do not talk specifically with them about their performance. Simply tell them you’re happy or unhappy with their work.

2. Spend all your time working on problems and leave top performers alone.

3. Invest 80 – 90% of your time trying to make marginal employees productive.

4. Spread renuneration around like peanut butter – evenly distribute it over everyone.

5. Design and conduct contests to “motivate” people to perform at a higher level.

6. Avoid having performance conversations with anyone.

7. Follow every fad going – regularly give people a new, hot book to read.

A manager was extremely distressed when their best employee unexpectedly resigned. In an exit conversation the employee felt there was no challenge in their work. Another employee became enraged when the executive to whom she reported gave her an annual “review” by simply saying, “You’re doing great work keep it up.” The employee quit immediately saying, “If that’s all he can say after a year working for him, I’m out of here!”

High performers love feedback on their performance. They want consistent, constructive, feedback. If you doubt this, scrutinize top performers in any field – especially the arts. They constantly review how they’re doing relative to desired outcomes. They actively seek out coaching and respond best to specific, performance-based feedback.

Taking an employee from a 3 to a 4 on any scale, takes more effort and produces significantly less than taking an employee from an 8 to a 9. The former is approximately a 14% improvement while the latter is 50%. Despite this, many managers invest excessive time and energy working with so-called “non-performers.”

Remuneration is a contentious and fuzzy subject. In a recent meeting with 26 up and coming leaders, the topic of “incentives” raised its ugly head. It became clear to us that these young managers believe that “incentives” work. Their question was, “What is the incentive to get people to work on these projects? How can we motivate others to make a contribution?”

There is NO evidence that incentives produce long-term results and there is strong evidence that an incentive-based system actually lowers performance. Once high performers reach a certain level their motivation is intrinsic, not extrinsic. With low performers, incentives actually mask incompetence. Even if incentives work, the results are related to the “bribe” rather than improved competency.

Yes, a person’s compensation is important to them and it’s imperative that it is tied in some way to performance. However, trying to bribe performance out of high performers drives them out the door. Incentives rarely motivate low performers. During a flashy roll-out of a sales contest I heard one person mumble, “That prize will look good in Charlie’s [the top producer] living room.” By conducting regular one-on-one’s, your “Charlie’s” can buy their own big screen TVs.

Fads. What a subject! How many times have we heard groans from people as they mumble about a new book the boss is reading? They see no relevancy to their business or day-to-day activities. He or she rushes from one “hot” idea to another with no apparent strategy or structure. Most business books are still three to five years behind current reality. Books are a great resource but, like every other tool, they are often abused. If there is no clear strategy in place, applying the “latest” management theory will have little, if any, effect.

Action Tips

In contrast to our opening tongue-in-cheek list, decide what results are most important to your business future.

o Connect others to two or three key strategies.

o Engage in performance conversations around competencies and performance.

o Give your direct reports regular feedback about their contribution to the overall strategy.

o Design your organization or department around creating what you want rather than reacting to circumstances or applying the latest fads.

“If you can’t measure it, you can’t manage it. However, if you don’t create what is truly important, you have nothing to measure or manage.”

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1 comment:

  1. Hi Dave,

    This is a great article that speaks directly to concerns of many of my (potential) clients. Thanks for the observations and action steps. I will be sharing this article on my blog and will (of course) credit you and link to your blog.



    Dean Pierson (Kamloops BC)